South suburban hospital to close

(Crain's) -- South suburban St. Francis Hospital & Health Center will close because of mounting financial troubles, its parent company announced Wednesday.

(Crain's) -- South suburban St. Francis Hospital & Health Center will close because of mounting financial troubles, its parent company announced Wednesday.

St. Louis-based SSM Health Care put the 1,400-employee facility in Blue Island on the block last year but found no takers. St. Francis has lost $40 million since 2002 and is projected to lose another $20 million this year alone, SSM said in a statement.

The move comes a few weeks after a private-equity-backed deal to buy the hospital fell through.

"As a system, we can and do carry hospitals that experience challenging times," SSM CEO Sister Jean Ryan said in the statement. "However, we cannot sustain these kinds of losses over an indefinite period of time."

SSM shopped the 280-bed hospital to 28 prospective buyers, including several Chicago-area health systems, even offering the facility for free, the statement said.

The hospital losses have resulted mainly from treating a growing number of uninsured and low-paying Medicaid patients, who make up about 25% of its inpatient volume, SSM said.

SSM cited as a factor in the decision its unsuccessful 2003 bid for state approval to build a second hospital in Orland Park, which it believes would have fared better financially and helped offset losses at St. Francis.

St. Francis will stay open until SSM gets state regulatory approval to close it, which could take several months.